that supports the jury's finding that the defendants acted with malice or reckless disregard of plaintiff's rights. A jury could have made a reasonable inference of "lack of remorse and likelihood of future violations." EEOC v. AIC Security Investigations, Ltd., 823 F. Supp. 571, 578 (N.D. Ill. 1993). It is also significant that defendants did not object to a punitive damage instruction based upon insufficient evidence at trial to support such an award.
In this regard, therefore, defendants' motion is denied.
C. Validity of Punitive Damages Award
The jury in this case awarded no compensatory damages, but awarded $ 300,000 in punitive damages against defendant Penril and $ 50,000 in punitive damages against defendant Burns. Defendants' argument here is based on the proposition that "no punitive damages may be awarded in the absence of actual damages." By-Prod Corp. v. Armen-Berry Co., 668 F.2d 956, 961 (7th Cir. 1982) (Illinois law). Plaintiff's dispute this proposition, but cite no contrary authority.
It is not necessary for the court to reach the broad question of whether in any case punitive damages may be proper absent compensatory damages, because the court holds that the backpay award is, for these purposes alone, properly thought of as compensatory damages.
The Supreme Court has recently noted that "Title VII's back pay remedy . . . is a 'make-whole' remedy that resembles compensatory damages in some respects." Landgraf v. USI Film Products, 128 L. Ed. 2d 229, 114 S. Ct. 1483, 1490-91 (1994). The back pay remedy is in some respects termed "equitable," see id. at 1490, but the court believes that for these purposes to cling to those categories would be overly formalistic. The safeguard in the rule (assumed to operate here) that punitive damages cannot be awarded without compensatory damages, appears to be that punishment of a party is inappropriate where there has been no showing of injury to another party. Otherwise, the civil justice system would function to punish "bad" behavior, rather than to right wrongs to the extent practicable between parties. In this Title VII case, back pay is plaintiff's compensation for injury at the hands of defendants, even if the law does not call it "compensatory damages." What defendants want to do is cut out the definition of compensatory damages from Title VII and paste that definition next to the rule that compensatory damages must accompany a punitive damage award. This approach makes less sense than the plaintiff's, under which the requirement of compensatory damages is considered in its context and in light of its purposes.
Defendants' motion in this regard is denied.
D. Retrospective Liability
Defendants have repeatedly objected to the introduction of evidence predating the November 21, 1991, effective date of the Civil Rights Act of 1991. The court has consistently overruled defendants' objection, and has articulated reasons why, so the court need not provide much more detail in response to what must be now viewed at as an effort to preserve defendants' record. Nonetheless, a brief statement of the court's reasoning here is in order.
As defendants' point out, the Supreme Court in Landgraf held that "the new damages remedy in section 702 [of the Civil Rights Act of 1991] . . . is the kind of provision that does not apply to events antedating its enactment in the absence of clear congressional intent [which the court did not find]." Landgraf, 114 S. Ct. at 1506. The event here is plaintiff's termination, which occurred April 7, 1992. The wrong occurs in an employment discrimination case when the adverse employment decision "was made and communicated" to the employee. Delaware State College v. Ricks, 449 U.S. 250, 258, 101 S. Ct. 498, 504, 66 L. Ed. 2d 431 (1980); see also Cada v. Baxter Healthcare Corp., 920 F.2d 446, 450 (7th Cir. 1990), cert. denied, 501 U.S. 1261, 111 S. Ct. 2916, 115 L. Ed. 2d 1079 (1991). So it is clear that the 1991 Act applies to the adverse employment decision -- termination. Given that, it is hard to accept defendants' suggestion that the context and background provided by evidence predating that decision should not have been heard by the jury.
Insofar as defendants' planning was affected by passage of the 1991 Act, defendants could have avoided liability by not terminating plaintiff, as the termination occurred after the 1991 Act took effect.
Defendants' motion in this regard is denied.
III. PLAINTIFF'S MOTION TO ENTER ORDER ON BACKPAY DUE PLAINTIFF
Defendants contest a number of issues in plaintiff's request for back pay relief. The court will resolve those issues, and then calculate the back pay award.
A. Contested Issues
1. Agreement regarding reinstatement
Defendants' first argument here actually concerns reinstatement. Defendants argue that plaintiff has reneged on an agreement at the jury instruction conference not to seek reinstatement. Defendants mischaracterize the nature of the agreement at the instruction conference. References to reinstatement in defendants' instruction ten were deleted because of the consensus that the court, not the jury, awards reinstatement. It was therefore agreed that the instruction to the jury that they are not to award reinstatement under certain circumstances would not have served any purpose. Plaintiff never agreed to abandon her claim for reinstatement.
2. Backpay constituting improper additur
Defendants next contend that the addition of back pay to the verdict constitutes improper additur to a jury verdict that awarded no compensatory damages. Nothing in the 1991 Civil Rights Act removes back pay as a court-imposed remedy. In fact, the 1991 Act, amending the relief provision, 42 U.S.C. § 2000e-5(g), still discussed back pay as being relief ordered by the court. That being the case, there is no logical reason to regard the imposition of back pay by the court as an "additur" to the jury's award of compensatory damages.
In any event, this was how the jury was instructed, that "in calculating damages, you should not consider any back pay that the plaintiff lost. The award of back pay, should you find defendants liable, will be calculated and determined by the court." (Plaintiff's Jury Instruction No. 32.)
The court does not view an award of back pay as an additur.
3. Affirmative defense that employer would have made same decision even absent the illegal motivation
As the court has discussed in footnote two above, defendants proffered no jury interrogatory on the affirmative defense. Therefore, as plaintiff argues, it would not make sense to assume that the jury would have answered the question defendants' way had the question been asked. This ground for opposing a back pay order also fails.
4. Failure to mitigate
It is defendants' burden to establish that plaintiff failed to mitigate her damages. Gaddy v. Abex Corp., 884 F.2d 312, 318 (7th Cir. 1989). To make such a showing, defendants must prove that "(1) the plaintiff failed to exercise reasonable diligence to mitigate [her] damages, and (2) there was a reasonable likelihood that the plaintiff might have found comparable work by exercising reasonable diligence." Id.
Defendants purport to have met this burden through the testimony of Elisa Nallen, an employee of MCI Telecommunications, Inc., and Brian Barnett, president of Future Wave Communications, both prospective employers of plaintiff. When weighed against plaintiff's testimony regarding her search for employment, the court finds the testimony relied upon does not establish the affirmative defense of failure to mitigate. Defendants have not persuaded the court that these witnesses established that plaintiff "refused a job substantially equivalent to the one [she] was denied." Ford Motor Co. v. EEOC, 458 U.S. 219, 232, 102 S. Ct. 3057, 3066, 73 L. Ed. 2d 721 (1982).
5. Proper Rate of Interest
In the context of a section 1981 claim, the Seventh Circuit has held that "prejudgment interest . . . must be an ordinary part of any award of back pay." Williamson v. Handy Button Machine Co., 817 F.2d 1290, 1297 (7th Cir. 1987). There is no reason why the court's reasoning under section 1981 -- based on fundamental principles concerning the time value of money -- would not apply to a Title VII back pay award. The Seventh Circuit did note in Williamson that there are exceptions to the rule. See id. at 1297-98. But defendants forward none of these exceptions, and, in any event, the court does not view any as applicable here.
What defendants do contest is the proper statutory rate of interest. Plaintiff proposes the court employ the Illinois statutory postjudgment interest rate of nine percent. See 735 ILCS 5/2-1303. Defendants counter that the court should apply the federal postjudgment rate as established by 28 U.S.C. § 1961, which reflects the most recent 52-week Treasury bill auction.
While the parties appear correct that there is no definitive authority here -- neither the Supreme Court nor the Seventh Circuit has indicated what the rate of interest should be on Title VII back pay where it is awarded -- it is an overstatement to say that there is a complete absence of authority. In EEOC v. O'Grady, 857 F.2d 383, 391-92 (7th Cir. 1988), the Seventh Circuit made clear in an Age Discrimination in Employment Act case that the rate of prejudgment interest on a back pay award is a matter of the court's discretion. Neither party attempts to persuade which way that discretion should go, instead attempting to cling to either inapplicable (in plaintiff's case) or non-binding (in defendants' case) authority in an attempt to establish that one rate or another is mandated, which quite simply is not the case.
The common and accepted federal postjudgment rate should serve to make the plaintiff here whole, and the court finds no reason to apply the Illinois state statutory rate where another readily available devise will accomplish that goal. To avoid issues related to this rate being a fluctuating figure, based as it is on the latest 52-week Treasury bill auction, the court will use 4.55%, the rate in effect on the date of plaintiff's termination, as the rate throughout the calculation. The rate fairly steadily declined over the ensuing period, but since the measure chosen is so conservative to begin with, the court views the 4.55% rate as still fair.
B. Calculation of Back Pay Award
1. Amounts of Straight Back Pay
Defendants do not contest the accuracy of plaintiff's back pay figures. The court therefore adopts those figures, and before interest awards back as follows:
1992: $ 42,807.78
1993: $ 69,000.00